Prenuptial Agreements

Prenuptial Agreements

A prenuptial agreement (also called a “premarital agreement”) is a contract that a marrying couple signs that determines how certain financial issues will be decided in the event of divorce. Prenuptial agreements typically cover how assets and debts will be divided in the event of divorce, and whether one spouse will pay the other alimony.

97% of today’s marrying couples get married without a prenuptial agreement, while 50% of those couples will divorce at some point. Divorcing couples who have prenuptial agreements often save thousands or tens of thousands of dollars in attorneys’ fees when they divorce. Also, contrary to popular opinion, having a prenuptial agreement doesn’t make a couple any more likely to divorce than not having one. Similar to how car insurance can keep you from financial ruin in the unfortunate event of an accident, a prenuptial agreement is like insurance for your marriage; you hope to never need it, but having one can save you from a financial disaster.

A premarital agreement doesn’t have to be seen as a negative thing. Many couples use a prenuptial agreement to ensure that both will be financially secure in the event of a divorce, particularly if one spouse is passing up career opportunities to devote time to the family. Simply going through the process of negotiating a prenuptial agreement forces a couple to have the difficult but necessary financial conversations that only get more difficult after marriage.

Today, prenuptial agreements are losing their reputation as being a device used only by the very wealthy. If you have children from another marriage, own or plan to own a small business, or have a retirement account, you could benefit from having a prenuptial agreement. Set up a consultation today to see how you might benefit from a prenuptial agreement.